Maintaining up-to-date customer information is essential for any online business. Knowing who your customers are and how they evolve over time enables you to:

Better understand what your customers’ wants and needs are.

Develop a better picture of which types of offers are likely to generate the most customer responses.

Address complaints to improve and repair customer service problems as quickly as possible.

Gathering customer information should be an ongoing process. Regularly updating information about your customers – what they buy, how they found you, what they think of you – enables you to constantly improve your customer experience. Yet, for many businesses, doing so remains an obstacle:

45% of marketers say recruiting new customers is their biggest challenge, while 55% struggle to retain and upsell to current customers.

63.3% of businesses report out-of-date customer information, while 62.8% also say their customer data is incomplete. Meanwhile, a further 60.1% admit to having hardly any data for certain customers.

73% of companies view knowledge management as key to improving customer service and engagement, yet 27% of these companies don’t have a formal knowledge system in place.

Unfortunately, these companies fail to connect with their customers for one very simple reason: they don’t understand their customers’ changing motivations, desires, and needs. In fact, according to Brandshare, 51% of customers are disappointed with the way brands respond to their needs with only 10% of customers believing that brands understand and respond well to their needs.

Ignoring Your Customers’ Needs is Not an Option

Customers expect businesses to provide a personalized experienced, particularly online shoppers, 89% of whom stopped doing business with an e-commerce site because it didn’t understand who they were or what they wanted. And, yet, the vast majority of online customers are happy to share personal information with online business if it means they receive better, more relevant service. According to a 2015 Microsoft study, 80 – 90% of customers “are looking for a better experience across devices and [are] more willing to share information than they were two years ago.”

The most obvious cost of not knowing your customers’ changing needs is the inability to keep the ones you’ve worked so hard to acquire and the additional cost of acquiring new ones which, on average, is 7 times more expensive. You wont be able to hold on to your existing customers as your lack of customer understanding will make it very difficult to effectively give them what they need, when they need it, which is exactly what today’s customers expect: 86% of customers admit they are willing to pay up to 25% more for a higher level of personalized service. And if customers cannot get what they need from you, they’ll get it somewhere else. Bain and Company reports that a customer is 4 times more likely to go to your competitor if they have a problem with you that is service-related.

How Well Do You Know Your Customer?

Customer experience is very likely to eclipse price and product as the key brand differentiator by the end of this decade. To be relevant in 2020, companies will need to leverage customer information to offer personalized support, crucial to growing and retaining a healthy customer base. And to deliver the customized and highly personalized products, services, and experiences your customers increasingly demand, you will need to have in place efficient means with which to understand them.

Feedback surveys are, perhaps, the most efficient way to research and better know your customer: their requirements, their feedback on your products and services, their level of satisfaction with your customer support. Feedback surveys will help you answer all the pressing questions you have to design and deliver a better overall experience:

Do you know what your customers really want and need? Is your information current?

Do you know who your most valuable customers are and how to meet their needs?

Do you understand common needs that all of your customers have, as well as the unique needs of each segment?

In addition to feedback surveys, your customer relationship management system (CRM) holds valuable information about your customers that will help you to understand their needs. Look for patterns: when your customers typically make orders, problems customers experienced, how quickly you're responding to orders or delivering goods.

To understand your customers well, you need to be attentive to them whenever you are in contact with them. Knowing and being able to immediately respond to their changing needs will greatly improve your chances of delivering the exact experience they are looking for, which will drive loyalty, maintain your reputation and, ultimately, improve your bottom line. For these reasons, no business can afford to overlook the importance of gathering and using updated customer knowledge to better engage customers and, ultimately, sell more.